Page 89 - Martin Marietta - 2021 Proxy Statement

Appendix B

Non-GAAP Measures

Non-GAAP financial measures disclosed by management are provided as additional information to investors in order to
provide them with an alternative method for assessing our financial condition and operating results, and are often
requested by investors. These measures are not in accordance with, or a substitute for, GAAP and may be different from
or inconsistent with non-GAAP financial measures used by other companies. Adjusted EBITDA is an indicator used by the
Company and investors to evaluate the Company’s operating performance period to period.

EBITDA is a widely accepted financial indicator of a company’s ability to service and/or incur indebtedness. EBITDA is not
defined by GAAP and, as such, should not be construed as an alternative to earnings from operations, net earnings or
operating cash flow.

The following presents a reconciliation of net earnings attributable to Martin Marietta to consolidated adjusted EBITDA for
the years ended December 31, 2020, 2019 and 2010.

Consolidated Adjusted EBITDA for year ended December 31:

(dollars in millions) 2020 2019 2010
Net Earnings Attributable to Martin Marietta $ 721.0 $ 611.9 $ 97.0
Add back:
Interest expense, net of interest income 117.6 128.9 68.5
Income tax expense for controlling interests 168.2 136.3 29.3
Depreciation, depletion and amortization expense and earnings/loss from nonconsolidated
equity affiliates 386.0 377.4 182.3
Consolidated Adjusted EBITDA $1,392.8 $1,254.5 $377.1
Consolidated Total Revenues $4,729.9 $4,739.1
Adjusted EBITDA Margin 29.4% 26.5%

The leverage ratio is our consolidated debt to consolidated Adjusted EBITDA for the trailing twelve months. Management
uses this ratio to assess its capacity for additional borrowings. The following calculation as of December 31, 2020 is not
intended to be a substitute for the Company’s leverage covenant under its credit facility:

(dollars in millions)
Net Earnings Attributable to Martin Marietta $ 721.0
Add back:
Interest expense, net of interest income 117.6
Income tax expense 168.2
Depreciation, depletion and amortization expense and earnings/loss from nonconsolidated equity affiliates 386.0
Consolidated Adjusted EBITDA for the twelve months ended December 31, 2020 $1,392.8
Consolidated debt at December 31, 2020 $2,625.8
Consolidated debt-to-consolidated EBITDA at December 31, 2020 for trailing-twelve months Consolidated Adjusted
EBTIDA 1.9x

B-1 MARTIN MARIETTA